This study focuses on the issue of sanitation in developing countries impacting female labour force participation. Using the context of the informal sector, which, although marginalised, supports a sizable share of the workers in the economy, we analyse National Sample Survey Office (NSSO) 73rd round survey, 2015-16, on informal firms. We find a positive impact of toilet availability on the share of female workers in an informal firm. Heterogeneity concerns were addressed by categorising firms into different sizes as per the MSME (Micro, Small and Medium Enterprises) classification, and endogeneity concerns were addressed using instrumental variable (IV) regression and propensity score matching (PSM) technique.